Thanks for reaching out to us.

I can share some tips on how you can record them.

You can set up an expense account to track the amount of the damaged inventory items. Then, link them to a service item. Feel free to follow the steps provided by my colleague, 

Ryan_M to be guided in performing the process.

Once done, you'll have to create a sales receipt with the service you've just created. Make sure to add enter the correct amount of the damaged inventory item. This way, QuickBooks will recognize the amount as a loss for your business.

I'm also adding this article to learn how to see your best sellers, what’s on hand, the cost of goods: Use reports to see your sales and inventory status.

Keep me posted if you have any other concerns or additional questions about inventories. Have a good one.